4s ranch builder price advice (Thousand Oaks, Valley Center: sale, foreclosures, renting)

[randy76]

Guys,
Need a little advice here. I am new to the area..moving from out of town. I went to few places with my realtor and liked a house in 4S ranch. It is ~3500 sq ft and the builder is offering that for ~$670K. Based on my research, this is the level prices were in early 2003 for a similar sized home.

The big difference is on the Mello-roos. 2002/2003 buyers used to pay ~$2K/year while we are now forced to pay ~$5K/year.

Do you think this is a deal worth pursuing assuming that I like the house? Can Mello-roos go down in the future? What is the risk of home prices going down even further in the future. It is currently @$190/sqft Vs Market Avg of ~$230/sqft.

I can really use some advice here.

Thanks.

[CrissCT]

Mello Roos will not go down, but it will not go up either. If we knew what home prices will be in the future we'd all be rich, but I can give this advice. The home price is negotiable especially in this market, especially if you are a guaranteed sale (i.e., you don't have a home you need to sell to buy this home, you are pre-qualified, etc.).

I think you should also consider the following things. 1.) Is this the house you really want? 2. ) Is this the location you really want? 3.) Can you afford it? 4.) How long do we plan on living in this house - more than a couple years? Then I think if you answer yes to those questions it doesn't matter if prices go down a little bit. We bought our home when prices were down but they have gone down further (we also live in 4s) but I don't regret it. I didn't like renting a home and the additional cost of mello roos is worth it to live here for us.

Just curious - is the home in Maybeck? Good luck!

[randy76]

yes, it is Maybeck. Thanks

[achtungpv]

I would wait personally. 4S Ranch is nicknamed 4Closure Ranch for a reason. Even if you don't get a brand new house, in a year or two you'll be able to pick up a virtually new house cheap from a bank even if prices do start to go up.

Bubble Markets Inventory Tracking: Search results for 4Closure Ranch

[CrissCT]

Originally Posted by achtungpv

I would wait personally. 4S Ranch is nicknamed 4Closure Ranch for a reason. Even if you don't get a brand new house, in a year or two you'll be able to pick up a virtually new house cheap from a bank even if prices do start to go up.

Bubble Markets Inventory Tracking: Search results for 4Closure Ranch

I looked at some of the examples the blogger uses for his opinions. Although yes prices have gone down and the houses may have sold for a loss, they are not technically foreclosures. I actually know some of those houses - people get relocated and need to move quickly so company buys them out of their house, etc.

The builders have such a mark up on the homes that they can take a bigger "hit" on discounting the homes and I think some of the better deals are from the builder instead of individual buyers who can't afford such discounts.

Both new elementary schools in 4S are at capacity - with people moving into the new builds daily so down here at ground level things don't look so gloomy.

[gwranch]

hi,

I dont know where Myabekc is but I have 2 acres thats okd to build on now in Valley Center if you like this idea. There willbe no Mello roos or ???

It will be your own...
thanks
you can email me if you want pictures..
gwranch@cox.net

[adreher]

What is Mello roos?--is that the supplimental property tax? I am sorry--I am moving there from Boston maybe this year so we don't have those kinds of taxes--just plain old property tax.

[esmith143]

Mello roos is a trick that homebuilders use to make houses appear cheaper than they really are. Akin to .99 pricing but much more severe. Basically instead of paying all development costs up front, they take out a big loan to pay for roads and schools, and make homebuyers directly responsible for making payments on that loan. Those payments are called "mello roos". For example, instead of paying $800,000, you get a house for $700,000 but you have to make mello-roos payments of $5000/year for 30 years.

[Charles]

Originally Posted by CrissCT

Mello Roos will not go down, but it will not go up either.

Our Mello Roos went down slightly in Thousand Oaks, CA. It had something to do with the bond rate changing or something. It was a 15 Mello Roos started in 1998. I alway deducted it on my taxes like property taxes too.

[Charles]

Originally Posted by esmith143

Mello roos is a trick that homebuilders use to make houses appear cheaper than they really are. Akin to .99 pricing but much more severe. Basically instead of paying all development costs up front, they take out a big loan to pay for roads and schools, and make homebuyers directly responsible for making payments on that loan. Those payments are called "mello roos". For example, instead of paying $800,000, you get a house for $700,000 but you have to make mello-roos payments of $5000/year for 30 years.

Not sure if "trick" is the right word.

Somehow, someone has to pay for new infrastructure on new developments. I always deducted MR from my taxes (whether it was legal or not, I'm not sure.) Most MR neighborhoods are squeaky clean, with a modern look, modern traffic control devices and systems, landscaped roadway areas, sidewalk areas and bike lanes.

It's basically a cost a purchaser has to factor. Are the added benefits of a MR worth the cost? It's a personal decision.

Mello-Roos - Wikipedia, the free encyclopedia